Consumer watchdog cracking down on dodgy hotel booking websites

Last week businessman Dick Smith unleashed an attack on foreign multinational companies for ripping off family-owned Australian accommodation businesses.

In a video posted on social media, the irate entrepreneur accused big online hotel booking websites such as Trivago, booking.com and Wotif of “leeching” hundreds of millions from home-grown businesses and sending the money offshore.

Dick is urging Aussies to boycott the large online accommodation websites and instead go straight to the local businesses themselves, where he says you’re likely to get a cheaper price and keep the money in Australia.

ACCC Chairman Rod Sims tells Ray Hadley “this is a hugely important issue and you’re right, and Dick Smith’s right, that the way to get the best price is to call the hotel direct”.

The problem is these family-owned hotels entered into signed contracts with these large multinationals to promise they’ll give them the best price, this has meant they couldn’t offer a better price to those who approached them directly.

“Now we looked at that and thought now hang on that’s probably anti-competitive,” Mr Sims tells Ray.

The consumer watchdog sought “a lot of legal advice” and was able to make changes to allow competitive prices when you call the hotel.

“So the only reason you can now ring up the hotels and get a lower price directly is because of the action we took,” says Mr Sims.

However, Mr Sims tells Ray the law at the time restricted the ability to get a better deal on the hotel’s direct website.